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Develop a production plan and calculate the annual cost for a firm whose demand forecast is fall, 10,000; winter, 8,000; spring, 7,000; summer, 12,000. Inventory at the beginning of fall is 500 units. At the beginning of fall you currently have 30 workers, but you plan to hire temporary workers at the beginning of summer and lay them off at the end of summer. In addition, you have negotiated with the union an option to use the regular workforce on overtime during winter or spring only if overtime is necessary to prevent stockouts at the end of those quarters. Overtime is not available during the fall. Relevant costs are hiring, $100 for each temp; layoff, $200 for each worker laid off; inventory holding, $5 per unit-quarter; backorder, $10 per unit; straight time, $5 per hour; overtime, $8 per hour. Assume that the productivity is 0.5 unit per worker hour, with eight hours per day and 60 days per season. (Round up  "Number of temp workers"  to the next whole number and all other answers to the nearest whole number. Negative values should be indicated by a minus sign. Leave no cells blank - be certain to enter "0" wherever required.)

  Fall Winter Spring Summer
   Forecast 10,000     8,000     7,000     12,000     
  Beginning inventory                     
  Production required                     
  Production hours required                     
  Production hours available                     
  Overtime hours                     
  Temp workers                     
  Temp worker hours available                     
  Total hours available                     
  Actual production                     
  Ending inventory                     
  Workers hired                     
  Workers laid off                     

 

  Fall Winter Spring Summer
  Straight time mce_markernbsp;       mce_markernbsp;      mce_markernbsp;      mce_markernbsp;     
  Overtime                         
   Inventory                         
   Backorder                         
   Hiring                           
  Layoff                         
 



  Total mce_markernbsp;       mce_markernbsp;      mce_markernbsp;      mce_markernbsp;     
       
  Annual cost       mce_markernbsp;     

 

Operation Management, Management Studies

  • Category:- Operation Management
  • Reference No.:- M9371029

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